Happiness Express, a toy company, was established in 1989 by Joseph Sutton and Isaac Sutton. The company quickly took off and managed to capture a share of the highly competitive toy manufacturing market. In the first year of operation, the company made a few thousand dollars in sales, but by the fifth year its total revenue exceeded $40 million. The company's business model was designed to identify the latest children's characters that would be most marketable in the United States. They achieved this by relying on market research that would identify areas of interest for children in new media. Happiness Express primarily relied on this research and through this research developed its motto “In Kids We Trust”. Once the brothers determined which media characters would become popular with children, they purchased merchandise licensing rights for those characters from different studios and publishing companies. Happiness Express could then use these merchandising rights to make the character's figurines, shoelaces, toothbrushes, stuffed animals and a whole range of "back to school" items. Once the products were manufactured, the brothers then marketed these products to FAO Schwartz, Kmart, Target, Toys "R" Us and Wal-Mart. Happiness Express began operations by purchasing the licensing rights to "The Little Mermaid" and "Barney." The success of these lines gave the company a strong foothold in the toy market. In July 1994, Happiness Express Express went public with an initial offering of $10 per share, and within months the company's stock price had doubled. By 1995, Happiness Express was named a "#1 Dynamic Growth Company" by Business. Week In 1994, the merchandise 'Barney' middle of paper...... was predominant in the audit review included significant amounts receivable in the last month of the 1995 financial year. West Coast Liquidators and Wow Wee International Ltd. showed significant credit sales in the final days of 1995. This was unusual for these two accounts and Cooper & Lybrand had to take steps to verify these sales beyond that. 'a simple confirmation letter If a confirmation cannot be obtained, then the audit team should review the previous transactions that the company has made with this particular customer to see if the large sales are regular or irregular. Due to Cooper & Lybrand's failure to conduct a proper audit, insider trading information was provided to outsiders who could profit from the deception. Cooper & Lybrand are liable for damages caused to Happiness Express shareholders due to their inefficiency.